According to an independent report, US states are projected to realize $6.35 billion in annual tax revenue from the adoption of iGaming.
The report, entitled “U.S. iGaming State Tax Revenue Potential,” and created by VIXIO GamblingCompliance at the request of Light & Wonder, Inc. (NASDAQ: LNW), provides forecasts for the potential tax revenue that state governments could conservatively expect to earn if internet gaming, or iGaming, were legalized in each state that currently has either legal land-based casino gaming or online sports betting, or both.
iGaming includes the operation of casino-style games such as slots and table games, offered via digital platforms through players’ own devices. While sports betting involves betting on real-world sporting events either in retail locations or through mobile devices, iGaming is completely an online platform.
As explained in the report, if iGaming is legalized in all 42 states that currently allow land-based casinos or mobile sports betting, the potential size of the U.S. iGaming market alone could total over $30 billion. VIXIO estimates this could translate to a combined $6.35 billion in annual state tax revenue, assuming a 20 percent tax rate in newly authorized states.
According to the American Gaming Association (AGA), the six states in which iGaming is currently legal, Connecticut, Delaware, Michigan, New Jersey, Pennsylvania and West Virginia, generated $970 million in gaming tax revenue in 2021, compared with $560 million generated in the 30 states with sports betting.
Now, the United States have the chance to rise positions in the global iGaming industry given the change of laws. The U.S. continues breaking nationwide records, and we should expect to see the growth of the iGaming market continue to rise at a rapid rate in 2022 and beyond. Europe has more advanced regulation out of all the continents. The major players in the market include France, Germany, and the United Kingdom but other countries like Sweden have several established online platforms.
At a global level, the market is showing signs of relentless growth as forecasts released by the Fortune Business Insights estimated that global online gambling alone will be worth $158.2 0billion in 2028 with a compound annual growth rate (CAGR) of 11.4% for the period. A key factor that has contributed to the value of the industry is mergers and acquisitions and this trend will continue to play a role during the years.
Since 2020, online casinos have risen in growth, replacing brick-and-mortar venues. These websites make playing games easier, as they are easily accessed from numerous tech devices, mainly desktops, smartphone and tablets. The majority of websites feature games like poker, blackjack, slots, roulette, and a lot other games, which may not be found at land-based casinos. Anyways, land-based casinos will continue to have a meaningful position within the industry.
Online market growth will also be accelerated by the use of online payments globally. These methods have become easier for online gamers, as digital and mobile payments are more widely accepted. Furthermore, online payment services provide a secure and safe way of transaction, which has boosted their implementation in this business. All these improve the user experience as bettors feel that the transaction process for depositing and withdrawing funds takes too long, and they want more payment options to avoid disrupting play. Bettors say quick and seamless deposit and withdrawal experiences play an important part of their overall satisfaction and whether or not they return in the future. Cryptocurrency wallets can help advance further in this direction as security grants the safety of the user experience and respect of laws.
In addition, virtual reality and web3 will trigger a new wave of improvement possibilities.
Further, AI can help online site managers detects what players need at the right time when they need it, in order to provide real time costumer support via such tools as chats.